FUD – Use with Care.

Sowing the seeds of FUD (Fear, Uncertainty, and Doubt) has a long history as a tool for swaying decision making. It would be difficult to isolate its first implementation. Even our personal confrontation with FUD stretches back to the playground bully uttering threats, and perhaps to incidents before these.

FUD’s value to sales and marketing has long been proven. Consumer behaviorist would claim that we make purchases when our goals are activated and we wish to bring ourselves closer to a goal state or counter a recent loss. Hiemen & Sanchez describe this as either Growth Mode or Trouble Mode. In a cruder manner, it can be rephrased as stating that all purchases are due to greed or fear in one form or another.

Broad Examples

Consumer marketers will often sow the seeds of FUD directly in order to advance a product category. For instance, take the popular move to add antibacterial agents to soaps. All mother’s want healthy children. Antibacterial soaps claim that they kill bacteria, presumable bacteria that can make kids sick. The commercials for these antibacterial soaps will highlight that fear, raise uncertainty over the diseases bacteria may cause, and prey upon the doubt that mothers may have over theirs and their family’s cleaning habits. The result has been a rapid penetration of antibacterial soaps into the home, including hand soaps, dish soaps, counters soaps, and more. Questions such as the efficacy of using antibacterial soap over simply washing hands longer, or the potential ecological challenge created by selectively killing weaker strains of bacteria yielding more threatening challenges of antibacterial resistant strains, are not raised by these commercials. The FUD factor surrounding antibacterial soaps has been so strong so as to quell any dissent within the market.

Can similar efforts be executed in business markets? Yes.

Some readers may recall a series of TV commercials for AT&T that takes place in the executive washroom. A young exec is about to be put on the carpet and he wonders “what did I do wrong”, then reflect “maybe it was because of the (non ATT) phone system I purchased.” The moral of the commercial is that managers never get in trouble when they buy AT&T. This commercial planted FUD in the mind of the viewer because everyone knows that nobody ever got fired for choosing the low-risk alternative. The way to get into trouble is to try to take a risk on an unproven alternative.

Furthermore, there are numerous industry trends where businesses jump on the same band-wagon, some motivated by vision while others motivated by fear. Yet, more interesting cases arise when FUD is used in a single sales opportunity to sway a single prospect from one decision to another. It can be an aggressive and effective tactic when care is taken in the implementation of a FUD effort.

Tactical Goals achieved through a FUD effort

When used in a single sales opportunity to sway a purchase decision, FUD is deliberately sowed in a covert manner to delay a negative event or sway a prospect’s inclinations.

The goal of raising FUD factors in single sales opportunities is to slow down the progress of a competitor. If used on a wide scale by a company, FUD can be used to defend market share against a new market entrant and sway prospect’s inclinations back towards the market leader. During a single sales opportunity, FUD can stall a decision and therefore stall a competitor’s sales cycle with that particular prospect to create the time necessary to develop that prospect for the aggressor’s company.

A challenge to implementing FUD is that a tactic that can slow the process of a competitor can also slow the process of the practitioner. In general, anything that raises uncertainty slows decision processes. As such, FUD should be used more by those in a weak position than those in a strong position. However, in practice FUD easy to implement and many salespeople use it even when the prospect is favorably inclined towards their offer in order to further defend their opportunity.

Executing FUD

FUD is generally executed covertly, rather than overtly, against single competitors for a couple of key reasons. First, if FUD was spread against competitors overtly, the company spreading the fear, uncertainty, and doubt would then open itself up to being labeled as an unprofessional company that competes in a non-sportsmanlike manner. Second, the company that is being subjected to a FUD campaign would become well aware of the campaign and would then be in a position to execute a public relations and/or media campaign to thwart the attack.

Covert FUD campaigns will appear as a set of questions that are raised with prospects during a casual conversation. The form of these questions will vary according to the weakness of the competitor. A short list of example FUD creating questions follows. They are usually put in the role of a question rather than a statement in order to encourage the prospect to ponder the challenge and to avoid the unprofessional position of speaking poorly about competitors. The specific question that is raised is selected to highlight their weakest points. An answer is usually not sought to these questions. Just getting the prospect to think about the question is sufficient in a FUD campaign designed to slow the progress of the competitor.

When defending against a new entrant, typical FUD questions include

Do you think they have staying power in this industry?

Are they stable enough for you?

What is their long term commitment to this industry?

Who will support their solution in the future?

When attacking a company that has been through changes, typical FUD questions include

I wonder why they have such high turnover?

Do they seem to seek new financing every year?

They keep changing their senior executives. Are they stable?

When thwarting a company that is relatively new to the industry, typical FUD questions include

Are you sure their solution can scale to meet you needs like ours can?

Do they have the depth of functionality to meet your goals like ours does?

Have they worked in your industry like we have?

Is it a proven solution for companies like yours like ours is?

The questions designed to raise a prospects fear, uncertainty, or doubt should be founded in a true or perceived weakness of the competitor. The source of the FUD may be irrelevant to the decision at hand. For instance, the question of long-term commitment to an industry and their past industry experience may be less relevant to the issue of whether the company has the right skills to address the challenge at hand, yet the prospect may perceive this to be a more important factor.

Defending against FUD

To defend against FUD, the defender should address it directly. Since the goal of FUD is to raise fear, uncertainty, and doubt, the actions to counter it should be directed at showing trust, certainty, and strength. Even when the source of the FUD is legitimate, the effect of the FUD can be minimized by acknowledging the weakness directly, then countering that weakness with clear reasons how those challenges are being addressed or why other factors may be more relevant.

Use with Care

FUD is a natural outgrowth of the need to clarify points of parity and points of differentiation. The ethicalness of sowing the seeds of FUD rests upon the validity of the underlying source of the fear, uncertainty, and doubt. When used properly, FUD creates an emotional response in proportion to the weakness of the competitor’s offer and increases the awareness of the company’s strengths.

FUD is a powerful tool when wielded by the right professional. It can slow the progress of a competitor and create the time required to engage a prospect in your own sale cycle. But, if the sales cycle is going well, raising any source of fear, uncertainty, or doubt may delay the closing. Use with care.

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About The Author

Tim J. Smith, PhD, is the founder and CEO of Wiglaf Pricing, an Adjunct Professor of Marketing and Economics at DePaul University, and the author of Pricing Done Right (Wiley 2016) and Pricing Strategy (Cengage 2012). At Wiglaf Pricing, Tim leads client engagements. Smith’s popular business book, Pricing Done Right: The Pricing Framework Proven Successful by the World’s Most Profitable Companies, was noted by Dennis Stone, CEO of Overhead Door Corp, as "Essential reading… While many books cover the concepts of pricing, Pricing Done Right goes the additional step of applying the concepts in the real world." Tim’s textbook, Pricing Strategy: Setting Price Levels, Managing Price Discounts, & Establishing Price Structures, has been described by independent reviewers as “the most comprehensive pricing strategy book” on the market. As well as serving as the Academic Advisor to the Professional Pricing Society’s Certified Pricing Professional program, Tim is a member of the American Marketing Association and American Physical Society. He holds a BS in Physics and Chemistry from Southern Methodist University, a BA in Mathematics from Southern Methodist University, a PhD in Physical Chemistry from the University of Chicago, and an MBA with high honors in Strategy and Marketing from the University of Chicago GSB.

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